The Epstein-Barr virus (EBV) BZLF1 (Z) immediate-early transactivator initiates the switch between latent and productive infection in B cells. The Z protein, which has homology to the basic leucine zipper protein c-Fos, transactivates the promoters of several replicative cycle proteins. Transactivation efficiency of the EBV BMRF1 promoter by Z is cell type dependent. In B cells, in which EBV typically exists in a latent form, Z activates the BMRF1 promoter inefficiently. We have discovered that the p65 component of the cellular factor NF-kappa B inhibits transactivation of several EBV promoters by Z. Furthermore, the inhibitor of NF-kappa B, I kappa B alpha, can augment Z-induced transactivation in the B-cell line Raji. Using glutathione S-transferase fusion proteins and coimmunoprecipitation studies, we demonstrate a direct interaction between Z and p65. This physical interaction, which requires the dimerization domain of Z and the Rel homology domain of p65, can be demonstrated both in vitro and in vivo. Inhibition of Z transactivation function by NF-kappa B p65, or possibly by other Rel family proteins, may contribute to the inefficiency of Z transactivator function in B cells and may be a mechanism of maintaining B-cell-specific viral latency.